What the Covid-19 recession means for women and how to fight against it

Written by Charley Ross

The financial fall-out from a pandemic seems to be inevitable – but there are ways to safeguard against it. Charley Ross investigates how grocery shopping, travel, healthcare and house prices will be affected.

The Covid-19 pandemic has plunged the entire world into a Looking Glass-type state of disarray – one huge side effect being a global economic slump. Britain is experiencing its deepest recession since records began and, like with many unpleasant things, this will affect woman harshly in a number of ways.

So how are things different this time, and how will the latest economic blow affect women specifically? According to Bukiie Smart, financial coach and founder of millennial financial platform Save Spend Invest, the news is both good and bad. 

She advises that more women may have entered the workforce than during and immediately after the 2008 financial crash, and the pay gap may have closed slightly, but we still face similar – and larger – struggles in comparison to men. “A disproportionate number of women tend to work in lower-paying jobs, such as in hospitality and education,” Smart adds.

A proportion of women have upped the fight against the gender pay gap by moving their careers into STEM fields like technology, and are also setting up businesses that they can run from home, adapting in some way to the changing landscape of the working world to combat the problems the latest recession is providing.

Unfortunately, the scope of the crisis that Covid-19 will leave in its wake is much wider than those before it. “The last financial crash was a purely economic crisis, but this has been a public health, social and economic crisis,” Iona Bain, financial expert and author of Own It! How Our Generation Can Invest Our Way To A Better Future, says. 

“And research shows that this has created a new problem of women having to take on the bulk of childcare and homeschooling because schools are being shut. Women are losing income and pension contributions for their future.”

From the impact on your weekly food shop to planning for buying a house, there’s a lot to consider and prepare for. And while in many cases it is too soon to tell just how much damage the recession will cause, there are definitely strategies you can put in place to limit the impact. 

Food shopping

While research has identified an uptick in online grocery shopping – giving a wider opportunity for the domestic task to not be as gendered – many women may still find themselves carrying out this role, and the prices of food have not gone unaffected in the pandemic. “Global food prices have reached their highest level in almost seven years, which is concerning,” Bain says. 

However, prices seem to be fluctuating; they rose at the beginning of the pandemic but then fell towards the end of 2020. Brexit also remains an unfortunate factor, and has impacted food prices in the early months of 2021 already. Bain says prices could increase again in April, when new rules on imports come into force.

So, she advises pragmatically timing your trips to the supermarket so you can hit the early-morning or late-night reduced yellow sticker items, or to scout out cheaper local markets for fruit and veg. In terms of food preparation, there are many ways to cut costs while the price of your ingredients fluctuate. 

One great hack is to invest in a cookpot or slow cooker, where you can batch cook stews, soups, sauces, curries and chillies – a waste-free way to prepare delicious recipes with cheap ingredients. Being mindful of buying “hero” ingredients that are versatile and can be used in multiple meals – think passata, tinned fish, beans, pesto – is also a great money-saving, forward-thinking move.

Healthcare 

“Access to healthcare, free or otherwise, has obviously been massively reduced during the pandemic,” Bain says. “It’s clear that the NHS will be having to play catch up for years to come, and that will severely limit access to many different kinds of services women need.”

Although it’s by no means a catch-all, she recommends looking into income protection insurance to safeguard against loss of earnings from illness. It covers big expenses – including your mortgage or rent – and can be claimed for mental as well as physical illness. Now that more women than ever have joined the workforce – and many are opting to stay single – this product is well worth looking into to prepare, and give yourself some kind of safety net for any sickness during a recession.

House prices

While house prices are dipping at the moment – partially due to Covid-driven relocations – this won’t be the case forever, and it’s hard to predict what things will be like in a year’s time. So, Bain stresses the importance of caution and being mindful when making a big decision like getting a mortgage or committing to a certain property. Ensure you’re thinking of how suitable your home is to certain pandemic-driven needs, like working remotely, as these are likely to be of importance for a good while.

Getting approved for a mortgage is undeniably going to be more difficult. “Women may be affected if they have had patchy earnings due to care-related breaks from work or if they’ve gone self-employed,” Bain says. She recommends all first-time buyers under the age of 40 use the Lifetime ISA, which will get you up to £1000 a year from the government towards your first home.

“First-time buyers with smaller deposits are also going to have a harder time finding a good deal, so they need to save as much as they can to build a bigger deposit,” she adds. Bain also advises using apps like First Home Coach to make the process easier and, above all, prioritising saving and building the biggest deposit you can, so that you can get the best mortgage deal possible. 

To save as much as you possibly can, Smart advises that women need to be insistent on asking employers for flexible working that does not affect their pay if they are having to carry out homeschool or other at-home labour costs – otherwise, the gender pay disparity will only be exacerbated throughout this recession.

“Women should be building up their savings reserves and look to take on opportunities that may help them diversify and increase their income without working too many more hours,” she says. Above all, it is important to fight for the role so many women play as mothers and caretakers to be valued as the important labour as it is, not a silent, unpaid add-on to a working day.

Travel

While the majority of us are not travelling very far because of national lockdowns, Bain recommends looking carefully at travel insurance policies when borders do reopen and travel resumes in some way. With the purse strings tighter than ever before, it’s crucial that you know whether your insurance covers the cost that you need it to – particularly for if you were to fall ill – to prevent any mortifying pay-outs down the road. 

Also, in the short-term future, make sure you’re aware of whether your insurance is pandemic-proof. “There was a big shock last year with travel insurance, because lots of people thought that they would be covered [for pandemics],” Bain says. “But actually a lot of these insurers had small print that excluded events like Covid-19, which came as a big shock.”

The Covid-19 recession will act as yet another slight against women’s plight for equal pay, labour and healthcare opportunities. But Bain says that it’s important to be pro-active – to isolate the areas of your life that have been and will be affected, and strategise as best you can to limit impact.

“Hopefully we’re going to see a real flowering of women’s financial awareness and engagement as a result of all this,” she says. “If there’s ever a time for women to get engaged with the issue of financial equality – on a political and a personal level – it’s now.” 

Images: Getty

Speak to a financial adviser registered with the Financial Conduct Authority before taking any financial advice, and think carefully before making any decision.

Source: Read Full Article